We held an interview with Oya Narin, Chairperson of the Turkish Tourism Investors Association (TTYD), on Turkey’s tourism potential for the readers of Business Diplomacy.

We talked to Oya Narin, Board Chairperson of the Turkish Tourism Investors Association (TTYD), which was founded in 1988 to improve the tourism sector in Turkey with many activities over time, on many topics from the founding purposes of the Association to the current status of the tourism sector.

Can we talk about the founding purposes and activities of TTYD?

First, we want to thank the Foreign Economic Relations Board (DEİK), Turkey’s remarkable business diplomacy organisation of which we are also a founding institution, for its achievements and the importance it gives to our sector. We will conduct activities in the upcoming period that will result in synergy with DEİK.

TTYD was founded in 1988 by large-scale tourism investor companies and holdings. Our Association is the home of many major actors in over 400 sectors such as high-quality accommodation facilities, marina, airport facilities, aircraft companies, all of which are the backbones of our tourism. TTYD is a representative organisation with the entire value chain of tourism including an accommodation capacity of over 190,000 beds, 15,000 aircraft seats, a marina capacity of over 15,000 yachts, all the cruise ports in our country, golf courses, and six tour operators. Our members have made investments worth $50 billion to date and are employing over 130,000 people.

The founding purpose of our Association is to help the plans and programs carried out to develop the tourism sector of our country in terms of investors and managers and contribute to our country’s economy on ever-growing scales. TTYD has always had an active role in all processes of Turkish tourism, has been a reference institution for the investment processes and sustainability in national and international platforms, always helping with its opinions, recommendations, visions, and strategies. Our Association has been contributing to Turkey’s tourism breakthrough together with the major investors of our country.

We would like to hear your opinions on our country’s tourism potential. Do you think we use this potential to its fullest extent?

We have hosted around 600 million foreign visitors since 1982, earning nearly $600 billion in this regard. Considering that our country’s GDP in 2019 was $755 billion, we can have a better understanding of the size.

As the sixth destination in the world with the greatest number of tourists since 2019, our country ranks 13th in terms of tourism income. If we look at the income per visitor over the years, we can see great development potential. Turkey is now reaching its $65 billion income goal for 2023 to meet its external financing needs, and it will probably surpass it. To achieve this goal, of course, we have to increase the number of foreign visitors and revenues in 2019 by at least 50%. We believe that we will achieve around $350 billion income from the tourism sector by 2030. Our activities in TTYD give us the hope that we will increase this figure even further with structural transformations and supports we receive for the exporter position of our sector and increase our sector to a $120 billion income level annually. Factors such as achieving a breakthrough in the sector with projects of tourism residences, timeshare, and holiday clubs to meet the long-term travel demands after the novel coronavirus (COVID-19), and further diversifying tourism across the country for a 12-month period are critical to increase the tourism income per capita. In January 2020, we announced our Transformation Scenarios in Tourism Report on the axes of the structural transformation with our analytical recommendations. If we can begin this transformation that I have talked about this year, our sector will become a leading actor in the global competition.

If we want to increase the tourism sector’s potential contribution to the country’s economy, which currently attracts remarkable foreign currency through a major service export share, we need to increase the tourist influx steadily and conduct the right marketing activities both in and out of the country. To achieve that, we need to have a mindset to serve the competitive power of our tourism sector in international markets against the global tourism actors and support the growth of tourism establishments and chains in parallel with other sectors. We think that it would be a critical attempt to adapt the export support given to the manufacturing sectors to tourism, which is already a foreign currency attracting sector.

Since our sector’s trademark is attracting foreign currency, it would receive a major edge in competition with global actors, if;

• Our entire sector is provided the opportunity to benefit from the export supports in proportion to the foreign currency earned by including the entire tourism sector in the Decision on Supporting the Foreign Exchange Earning Service Trade of the Money, Loan and Coordination Committee no. 2015/8, like the healthcare tourism establishments,

• Certified tourism establishments benefit from the Value Added Tax (VAT) refund in exports,

• A system similar to the inward processing regime applied in the manufacturing industry is adapted to the tourism sectors to support the competitive power of our tourism sector and to decrease the use of illegal products, and the Private Consumption Tax and other tax burdens in the main entry items are decreased.

In addition, Turkish tourism needs support in turning into a brand and achieving foreign currency inflow, and we need more chain brands in the accommodation sector, especially in the world. In this regard, Turkish hotel/tour operations that have three or more hotels in Turkey and will invest in branding activities abroad should be supported in terms of their market entries and branding. We are fully confident that our country will reach its real tourism potential with these supports.

Tourism is one of the sectors that has been negatively affected by the COVID-19 pandemic. How did our tourism sector do during this period? What kind of a road map does the sector need to compensate for its losses?

The COVID-19 pandemic has affected and still continues to affect the entire world economy, especially the tourism sector. The World Tourism Organisation stated that the sector contracted by 78% globally in 2020. One of the most important pillars of our country’s development, the tourism sector provided record income and employment in 2019. However, the number of tourists coming into our country decreased by 70% and the tourism income by 65% in 2020 due to COVID-19. Tourism has a high feedback capacity with many sectors such as accommodation, food and beverage, restaurant, transportation, and insurance. In 2020, we experienced significant losses in all these sectors.

When we look at the global estimates, we anticipate that the level of income in 2021 in the tourism sector will be lower than half of 2019. Constituting 5% of the national income directly and 12% indirectly and providing a labour capacity close to 10% of the total employment, the tourism sector has to manage its high debt stock and continue its activities despite the limited income levels. This will put more than 2 million direct and indirect employees, mostly young people, at risk, working in 12,000 accommodation facilities, 11,500 travel agencies, airport and airline companies, and establishments. This may put the sector in danger of losing its economic integrity.

Our sector should be able to benefit effectively and widely from credit guarantee fund-supported loans, especially the Tourism Support Package in order to ensure the continuity of employment and businesses. However, the situation that we are in compels us to focus on strengthening the financing structure of the sector first. Financial support should be given to help the tourism sector recover in this process and then, our sector will be the carrier power of Turkey’s development in the medium to long-term through reinforced strategic importance.

We hope 2021 will be a year when we start to recover from the effects of the pandemic. Our competitors have dealt with the issue of vaccines, and now, the tourism sector needs to deal with this matter. It is very important to prioritise the entire food-beverage and accommodation sector in the vaccination period in order to ensure the health of tourism employees and domestic & foreign tourists. I hope that this pandemic will be taken under control quickly and tourism activities will gain speed in light of the changing norms. With vaccination, we believe that tourism activities will start recovering in the second half of 2021, and this momentum will continue to increase in 2022 and 2023.

With the vaccine attempts and the normalisation process starting, our sector will be able to contribute to the economy even more. I would like to point out once again that we, as TTYD, believe that we can increase the projected figures for tourism revenues much higher with the support of the structural transformation and the exporter position of the industry, reaching an annual level of $120 billion revenue. As the sixth country that attracts the most visitors, we should work harder to increase our revenues in this direction, create chain brands with supports, and export them to the world. We should accept the accommodation facilities of our country as the embassy of our cultural tourism and wave our flag in many more countries. With these new norms, the tourism sector in Turkey can be at the heart of world tourism. We put all our hopes and efforts to achieve that.

Board Chairperson of the Turkish Tourism Investors Association (TTYD) Oya Narin